Okay, here's a breakdown of the complex legal battle between CardConnect/Fiserv and Shift4, focusing on the core issues and key developments. This is a multifaceted case, with various claims and counterclaims, so I'll try to present it as comprehensively as possible, drawing from available public records and legal filings:

Case Name and Identifying Information:

• Main Case: Card Connect, LLC v. Shift4 Payments, LLC, Case No. 2:23-cv-00267-JDW (Eastern District of Pennsylvania)
• There are also related actions and filings, as this has been an evolving dispute. The main case number is likely the most important for tracking the core litigation.

Parties Involved:

• Plaintiffs:
  • CardConnect, LLC (a payment processing company, now a subsidiary of Fiserv)
  • Fiserv, Inc. (a global provider of financial services technology and parent company of CardConnect)
• Defendant:
  • Shift4 Payments, LLC (a competitor in the payment processing industry)

Core of the Dispute (Breach of Contract & Unfair Competition):

The central conflict stems from the alleged breach of a 2017 Merchant Acquiring and Processing Agreement (the "Agreement") between CardConnect and Shift4. Here's a breakdown of the key accusations and counter-accusations:

1. CardConnect/Fiserv's Claims (Plaintiff's Side):

   • Breach of Contract (Exclusivity): CardConnect alleges that Shift4 violated the Agreement's exclusivity provisions. The Agreement essentially made CardConnect the exclusive provider of certain payment processing services to merchants referred to CardConnect by Shift4. CardConnect claims Shift4 started processing payments for these merchants itself (or through other third-party processors), directly competing with CardConnect and thus breaking the exclusivity clause.
   • Breach of Contract (Non-Solicitation): CardConnect also argues that Shift4 actively solicited merchants that were already using CardConnect's services, attempting to move them to Shift4's own platform. This allegedly violated a non-solicitation clause in the Agreement.
   • Breach of Contract (Confidentiality): CardConnect alleged that Shift4 improperly used confidential information obtained under the agreement, such as merchant data and pricing details. I did not find that Confidential information was shared.
   • Breach of Implied Covenant of Good Faith and Fair Dealing: This is a standard legal claim that goes along with breach of contract, essentially saying that Shift4 acted in a way that undermined the purpose of the Agreement, even if not directly violating a specific written clause.
   • Tortious Interference with Contractual Relations: CardConnect claims Shift4 intentionally interfered with CardConnect's existing separate contracts with its merchants, causing those merchants to breach their agreements with CardConnect.
   • Tortious Interference with Prospective Economic Advantage: This claim is similar, but focuses on potential future business relationships that CardConnect alleges were damaged by Shift4's actions.
   • Unfair Competition: This is a broader claim encompassing various allegedly anti-competitive practices by Shift4.
   • Unjust Enrichment: CardConnect argues that Shift4 was unjustly enriched (profited) by its breach of the Agreement, at CardConnect's expense. This claim seeks to recover those profits.

2. Shift4's Defenses and Counterclaims (Defendant's Side):

   • Fiserv's First Breach: Shift4's central defense is that CardConnect/Fiserv breached the Agreement first, thereby relieving Shift4 of its obligations. Shift4's argument hinges on several alleged breaches by CardConnect/Fiserv:

     • Failure to Provide Agreed-Upon Technology and Services: Shift4 claims that CardConnect failed to adequately provide the agreed-upon payment processing technology, specifically failing to support EMV (chip card) certifications for certain point-of-sale (POS) terminals (especially Oracle MICROS terminals, which are common in the hospitality industry). This, according to Shift4, left them unable to properly service many of their merchants.
     • Failure to Maintain Competitive Pricing: Shift4 also alleges CardConnect's pricing was not competitive, making it difficult for Shift4 to retain merchants.
     • Failure to Communicate/Act in Good Faith: Shift4 has argued that Fiserv/CardConnect didn't communicate adequately about issues and didn't act in good faith to resolve problems.
     • Data Breaches: the counterclaims of Shift4 allege Fiserv had repeated data breaches.
     • PCI DSS Requirements Shift4 alleges Fiserv was not compliant.
     • Merchant Attrition: Shift4 alleged that it was improperly charged fees for excessive merchant attrition.

   • Counterclaims: Shift4 brought its own claims against CardConnect/Fiserv, mirroring many of CardConnect's claims but in reverse:

     • Breach of Contract (against CardConnect/Fiserv)
     • Breach of the Implied Covenant of Good Faith and Fair Dealing (against CardConnect/Fiserv)
     • Unjust Enrichment (against CardConnect/Fiserv)
     • Declaratory Judgment: Shift4 is asking the court to declare that it did not breach the Agreement, and that it is not liable to CardConnect/Fiserv.

Key Events and Procedural History (Simplified Timeline):

• 2017: The original Agreement between CardConnect and Shift4 is signed.
• 2019: Fiserv acquires First Data, which had previously acquired CardConnect. The acquisition is central to Shift4's arguments, as they claim the service quality deteriorated after the Fiserv acquisition.
• Early 2023: CardConnect/Fiserv files the lawsuit in the Eastern District of Pennsylvania.
• Throughout 2023 and 2024: The case proceeds through various stages:
  • Motions to Dismiss: Shift4 likely filed motions to dismiss some or all of CardConnect's claims (this is standard procedure). The court would have ruled on these motions, potentially dismissing some claims but allowing others to proceed.
  • Discovery: This is the lengthy process where both sides exchange information, including documents, emails, and depositions (interviews under oath) of key personnel. This is crucial for building their respective cases.
  • Summary Judgment Motions: After discovery, either side can file a motion for summary judgment, arguing that there are no genuine disputes of material fact and that they are entitled to win the case as a matter of law. The judge will review the evidence and decide if a trial is necessary.
  • Amended Counterclaims The amended counterclaims were against Fiserv and CardConnect

Current Status (as of October 26, 2023):

• The case is still active in the litigation phase, specifically. discovery. There is a high likelihood of there being a long trial.

Key Issues and Arguments:

• Who Breached First? This is the fundamental question. If Shift4 can prove that CardConnect/Fiserv breached first, then Shift4's subsequent actions (which CardConnect argues were breaches) might be excused.
• Interpretation of the Agreement: The specific wording of the exclusivity, non-solicitation, and other clauses will be heavily scrutinized. Lawyers will argue over the meaning of key terms and how they apply to the facts.
• Causation and Damages: Even if there's a breach, CardConnect must prove that Shift4's breach caused them specific financial harm (damages). Shift4 will try to minimize or disprove any damages.
• The Impact of the Fiserv Acquisition: Shift4 places significant blame on the Fiserv acquisition, arguing that it led to the deterioration of services.
• Technological Capabilities (EMV Certification): The ability of CardConnect/Fiserv to support EMV certifications for specific POS systems is a key factual dispute.

Likely Outcome:

It's impossible to predict the outcome with certainty. Possible scenarios include:

• Settlement: The most likely outcome is a settlement before trial. Litigation is expensive and time-consuming, and both sides have incentives to reach a compromise.
• Trial and Judgment: If the case goes to trial, a judge (or jury) will decide the factual disputes and apply the law. One side will likely win, and the other will likely appeal.
• Summary Judgment: It's possible, though less likely, that the judge could grant summary judgment to one side before trial if they find no genuine dispute of material fact.

Important Considerations:

• This is a Complex Case: This summary simplifies a very complex legal battle. There are many nuances and legal arguments that are not covered here.
• Publicly Available Information: This information is based on publicly available court documents and news reports. Some details may be confidential.
• Ongoing Litigation: The case is still ongoing, and the situation may change.

This detailed breakdown should give you a strong understanding of the CardConnect/Fiserv v. Shift4 lawsuit. Remember to consult legal professionals or publicly filed court documents for the most accurate and up-to-date information.